Special finance and traditional financing are two common options for purchasing a vehicle, each with its own set of advantages and disadvantages. Our expert team at Dave Says yes is here to help you understand the differences between these financing options that will help you make an informed decision about which option is best for you.

Special Finance:

Special finance is designed for individuals with less-than-perfect credit or those who may have difficulty obtaining financing through traditional channels. This type of financing typically comes with higher interest rates and may require a larger down payment compared to traditional financing.

One of the main advantages of special finance is that it provides an opportunity for individuals with challenged credit to purchase a vehicle. For those who may not qualify for traditional financing, special finance can be a lifeline, allowing them to get behind the wheel of a car they need for work or personal reasons.

However, there are also some downsides to special finance. The higher interest rates mean that buyers may end up paying more for their vehicle over the life of the loan. Additionally, the terms of special finance loans may be less favorable compared to traditional financing, with shorter loan terms and stricter repayment requirements.

Traditional Financing:

Traditional financing, on the other hand, is offered by banks, credit unions, and other financial institutions to individuals with good credit history. This type of financing typically comes with lower interest rates, longer loan terms, and more flexible repayment options compared to special finance.

One of the primary advantages of traditional financing is the lower cost of borrowing. With lower interest rates, buyers can save money over the life of the loan and enjoy more manageable monthly payments. Additionally, traditional financing often comes with more favorable loan terms, such as longer repayment periods and lower down payment requirements.

However, traditional financing may not be accessible to everyone, especially those with poor credit history or limited credit. Individuals who do not meet the credit requirements may find it challenging to qualify for traditional financing and may need to explore alternative options such as special finance or leasing.

Special finance and traditional financing each have their pros and cons. Special finance provides an opportunity for individuals with credit challenges to purchase a vehicle, with slightly higher payments and possibly longer terms. Traditional financing generally offers lower interest rates and more favorable loan terms but may not be accessible to everyone. It’s essential to thoroughly review the advantages and disadvantages of each option carefully and choose the financing solution that best fits your needs and financial situation. Once again, this is exactly what our team at Dave Says Yes is built to do! Stop by today and see how we can help you get the vehicle you want.